Term deposits, also known as fixed deposits, are a popular investment option among many investors. A term deposit is a type of investment where you deposit a fixed amount of money for a fixed period of time, usually ranging from a few months to several years.

Here are 7 things you must know about term deposits:

Interest rates: The interest rates on term deposits are usually higher than the rates offered on regular savings accounts. The interest rate you receive on your term deposit depends on the amount you invest, the length of the term, and prevailing market rates.

Fixed term: Term deposits have a fixed term, meaning you cannot withdraw your funds before the end of the term without incurring a penalty.

Guaranteed return: Term deposits offer a guaranteed return on your investment, making them a low-risk investment option.

No market risk: Unlike stocks or mutual funds, term deposits are not subject to market fluctuations, making them a safe investment option.

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Early withdrawal penalty: If you withdraw your funds before the end of the term, you may be subject to an early withdrawal penalty, which can reduce your earnings.

Automatic rollover: Many term deposits automatically roll over into a new term after the initial term ends, unless you instruct the bank to do otherwise.

Diversification: While term deposits are a safe investment option, it is important to diversify your portfolio by investing in other asset classes, such as stocks, bonds, and real estate, to achieve long-term financial goals.

Overall, term deposits can be a good investment option for those looking for a safe and guaranteed return on their investment. However, it is important to understand the terms and conditions of the deposit and consider other investment options for diversification purposes.

BEST INTEREST OFFERED ON TERM DEPOSITS (Banks, Company and Post office Deposits)

Data as on respective banks’ and companies’ website on 18 April 2023. Highest interest rate on Term Deposits (for non-senior citizens; Deposit amount below Rs 2 cr) for all listed (BSE) public & private banks along with companies with ‘AAA’ rated FDs and post office time deposit are considered for data compilation. Institutions with highest FD rates listed in the table in descending order in their respective categories. Institution whose websites don’t mention the data are not considered. ^Only company FDs with a rating of ‘AAA’ are considered in the table. Table includes companies with highest cumulative deposit interest rates and applicable tenures for the highest rate.

Compiled by BankBazaar.com